NQM issues new target's statement

The takeover battle for
North Queensland Metals
Ltd (NQM) has taken another twist, with the explorer forced to issue a supplementary target's statement.

NQM has been at the centre of an increasingly acrimonious two-way takeover battle between
Conquest Mining
Ltd and
Heemskirk Consolidated
Ltd.

In earlier statements, NQM had recommended the offer from joint venture partner Heemskirk, saying it was better because it consolidated ownership of the Pajingo gold mine near Charters Towers in Queensland.

At the companies' closing prices on Wednesday, the Conquest offer valued NQM at 32.5 cents per share, or $64.88 million, while Heemskirk's scrip offer had an implied worth of 34.8 cents per share, or $69.47 million.

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But the Takeover Panel on Wednesday ruled NQM would have to make changes to its target's statement in relation to Conquest's offer.

The panel found deficiencies in NQM's original statement including the way the offer premia were presented, implications that NQM director Don Walker was conflicted and the way forecast financial information was used.

In an after-market announcement on Wednesday, NQM issued a supplementary target's statement to correct the problems.

It said Mr Walker, who had recommended the Conquest offer, was wrongly implied to be conflicted, and said that the two NQM directors who had recommended the Heemskirk bid would be independent non-executive directors at Heemskirk.

"They do not consider that the agreement regarding their appointment gives rise to any material conflict of interest," NQM said.

NQM also published a new version of a graph the Takeovers Panel found misleading, showing information on the premia that the Heemskirk offer provides to the Conquest offer.

The original graph did not compare the implied value of the two offers using the same dates.

Conquest welcomed the panel's ruling.

"Conquest hopes that the two NQM directors who have recommended acceptance of the Heemskirk Consolidated offer and the rejection of the Conquest offer will now adopt a more balanced approach," it said.

On Thursday, Heemskirk released an updated disclosure in relation to its takeover move.

Heemskirk clarified earlier statements it had made regarding Conquest's bid including the potential issue of NQM options to three Conquest directors, the exposure NQM shareholders would have to Conquest's assets and cash reserves, and the termination of Heemskirk's Founders Plan.